UK: Frankie & Benny’s drives 15% rise in profits at The Restaurant Group
Frankie & Benny’s owner The Restaurant Group cashed in on a growing appetite for breakfast as it served up a 15% earnings boost for the first half of 2013.
The chain helped TRG achieve profits before tax of £30million as it focused on growing sales of its morning offering, which includes American-style pancakes and muffins as well as a traditional fry-up.
Like-for-like sales at the group, which also owns the Chiquito and Garfunkel’s brands, were up by 5%, with total revenues rising 11.5% to £280m.
TRG, which operates 400 restaurants and pub restaurants across the UK, said it had kept a lid on costs despite inflationary pressures and cut back on promotions, helping it to boost profit margins. Its interim dividend was up 17% to 5.25p.
It recorded an increase in customers as well as higher spending per head - partly through menu price increases and partly through customers “trading up”.
Chief executive Andrew Page said the group had enjoyed a “strong performance”, with seven new outlets opened in the six months to the end of June, with four more since then and 30 to 35 further venues expected by the end of the year.
Sales growth slowed in July amid the heatwave though it picked up again in August. Like-for-like growth for the 34 weeks to August 25 slipped to 4.25%.
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Frankie & Benny’s, which has 226 restaurants, including branches at Ipswich, Colchester, Bury St Edmunds, Haverhill, Braintree, Chelmsford and Stansted Airport, enjoyed a “sizeable uplift in revenues and profits” over the first half, chairman Alan Jackson said.
“The breadth of appeal and excellent value for money of our offerings continued to encourage more customers to visit our restaurants including a significant increase in the sale of breakfasts, an area of potential growth that we have been focusing on.”
TRG expects to open between 15 and 19 Frankie & Benny’s restaurants in 2013 as well as three to four new Chiquito outlets. No new Garfunkel’s openings are planned for the second half.